Texas deal on Medicaid expansion sought

CHRIS TOMLINSON | Associated Press

Published 7:37 am, Thursday, January 24, 2013

AUSTIN, Texas (AP) — The Affordable Care Act is the federal law that Texas Republicans love to hate, but one top lawmaker says expanding health care for the working poor could happen if federal authorities are willing to strike a deal.

Republican Sen. Jane Nelson, chair of the Health and Human Services Committee, said she hopes the Centers for Medicare and Medicaid Services will allow Texas to receive $27 billion to expand Medicaid. But she said the key is to allow lawmakers to develop a Texas-specific program that will not blow the state's budget.

"I am still open to anything that will allow us to have the flexibility that we need, and that will also give us the assurance that it's not going to put us deeper in debt," Nelson told The Associated Press in an interview.

Expanding Medicaid, the joint state-federal health care program for the poor and disabled, was a critical requirement under the Affordable Care Act designed to make sure 98 percent of Americans have health insurance. But the U.S. Supreme Court ruled that federal authorities cannot require states to expand Medicaid, and so far Texas and more than 20 other states have refused to do so.

Gov. Rick Perry has rejected the Affordable Care Act as an affront on state's rights and said he wants the federal money with no strings attached in a block grant. The Perryman Group, an independent economic consulting company, estimated that Texas will miss out on $90 billion in increased economic activity and leave at least 1.5 million people uninsured if it does not expand Medicaid.

Nelson said a block grant was not the only way to reach a deal. She said a waiver that would allow the state to develop a tailor-made program within certain federal boundaries might be enough.

A spokesman for the Centers for Medicare and Medicaid Services on Thursday did not have an immediate comment on possible waivers for Texas. Under federal statute, waivers are generally only granted if they expand the number of people eligible, reduce costs or add additional services to the disabled, poor or elderly.

Nelson is among those who want to require some recipients to contribute toward their health care costs — such as paying income-based premiums or co-payments — something federal authorities have until now have rejected under Medicaid. She said Medicaid can also be made more efficient.

Last week Nelson announced legislation intended to make it easier to identify and punish those who defraud the program.

"We've got to address these root problems before I will support expanding it," Nelson said.

Nelson identified Rep. Garnet Coleman, D-Houston, as a key player in working toward a deal with federal officials. Coleman has said he supports a limited requirement for some Medicaid patients to pay part of their health care costs, adding that he believes a deal is possible. Health and Human Services Commissioner Kyle Janek has said his staff is working with federal authorities to see what's possible.

Health and human services have grown to about 30 percent of the Texas budget and the cost of Medicaid has doubled since 2003. Nelson has introduced legislation she says will bring those costs under control.

Last session, the Legislature intentionally underfunded Medicaid by $4.8 billion, a tactic that allowed lawmakers in 2011 to claim they balanced the budget, but also created an IOU that is now due. Nelson said that was the right decision at the time, but that she hopes the budgeting process will not create any more IOUs, if experts can accurately predict how many people will need Medicaid.

Advocates for the poor and disabled complain that the current draft budgets don't account for inflation or population growth. Nelson said she expects the draft budget to change by the time it passes in May.

"We're going to look at how we are spending that money..." Nelson said. "It makes no sense to me to have very few people in long-term care who have a huge array of services that aren't needed or used, and then have long waiting lists for other people who don't get any services."